Walmart OTIF Update 2/27/2019
Walmart announced today that starting in May, they will measure On Time and In Full (OTIF) performance separately and assess a 3% penalty on each noncompliant case. The new approach to OTIF was announced during the 2019 Supplier Growth Summit, that concludes today in Rogers.
Walmart stated the goal of the changes was to simplify the program and provide greater visibility to suppliers. Walmart stressed that it will only impose one penalty per noncompliant case, but suppliers could still see a fine of 3% the Cost of Goods Sold for each case in an order that fails to meet OTIF.
The chart below illustrates how fines could be allocated on an order of 20 cases to the RDC network.
The changes include an increase in fill rate expectations to 95% for General Merchandise and Health & Wellness and to 97.5% for Food and Consumables.
The on-time delivery expectations increase to 87% for full truckload suppliers and to 70% for less than truckload (LTL) suppliers.
Walmart will use the below equations to determine OTIF compliance.
If you’re not already meeting these expectations, CaseStack can help.
CaseStack’s Walmart Freight Consolidation Program’s on-time performance averages 95% or better – year-round. And our pick accuracy is above 99%, so we can help you keep the penalties to a minimum.
To learn more about CaseStack’s Walmart program and how it can help protect you from OTIF penalties call (855) 638-3500, email email@example.com or CLICK HERE.
Revised on 3/11/19